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Título
How do country-level governance characteristics impact the relationship between R&D and firm value?
Autor(es)
Materia
Market valuation
Foster economic growth
Social welfare
I+D
Financial system
Clasificación UNESCO
5307.13 Teoría de la Inversión
5307.08 Teoría del Crecimiento Económico
5307.19 Teoría del Bienestar
Fecha de publicación
2015
Citación
Pindado, Julio., Queiroz, Valdoceu de., de la Torre, Chabela. (2015). How do country-level governance characteristics impact the relationship between R&D and firm value?. R&D Management 45(5), 515-526. doi.org/10.1111/radm.12115
Resumen
[EN] This article addresses the question of how country-level governance characteristics moderate the market valuation of research and development (R&D). Using a valuation model and panel data from companies in the European Union, United States, and Japan, we find that effective corporate governance allows the market to better assess a firm's R&D investments. This finding is the conjunction with the effect of the legal system, the financial system, and mechanisms of control. First, as effectiveness of investor protection increases, the market valuation of R&D projects also increases. Second, more developed financial systems do a better job assessing R&D. Third, effective control mechanisms reinforce the positive effect of R&D on a firm's market value. In sum, our findings shed light on how policymakers can increase the benefits from firms' R&D spending and thus foster economic growth and social welfare using these country-level governance characteristics.
URI
ISSN
0033-6807
DOI
10.1111/radm.12115
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